The Landlord Thread

[hoops902]

Feb 19, 2019 13:27:27 GMT -5 cottontail said:

Quote removed as post quoted was removed by the OP. mmhmm, Administrator

I would say my dad follows the same thinking that he wants lower rent (and he also does a lot of extras for them).  I don't think he would agree with your specific logic (or your grandparents' philosophy) exactly though.  He doesn't think that because the rent is low tenants will appreciate it.  Frankly, I don't think tenants give a lot of thought to "market rent".  If anything, the best argument for that philosophy is they may not "appreciate it", but may be too scared to lose a good deal to do things wrong.  His theory is more that if he charges below market rent and has a good reputation...he has a WIDE population of potential renters, so he can cherry pick the ones he thinks will be most responsible (as such, he rarely rents to random younger people.  He rents houses, primarily to young couples that he knows, to more mature families new to the area, and to people he knows who may be going through a divorce, building a house, or otherwise in need of a home rental).  There's a reason he has a waiting list of dozens of people when he only has a dozen houses, and the cheaply built townhomes in the area can't get a decent occupancy rate...he's providing a deal that most people want and they're trying to top out on rent as a company.

I also think a lot of the "value things which are expensive" applies more to purchasing "things" than to renting a place to live (in that I think people aren't likely to value a place of $800 and trash it any more than they would if it were $1000 if all else were equal).  

[Bonny]

Feb 19, 2019 13:27:27 GMT -5 cottontail said:

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You charge slightly lower rent in order to get a larger pool of tenants so you can be more selective to whom you rent. You are running a business not a charity.

I have supplied/replaced appliances at my rentals. The units have been higher end and that's what is expected. I really don't want people moving heavy appliances in and out of my places every time they move.

I do agree with Phil that this is a situation where you have to suck it up as a cost of doing business. I don't think the court route is going to end well for you.

This is not an uncommon problem. Why do you want to be a landlord?

[The Walk of the Penguin Mich]

Feb 19, 2019 13:27:27 GMT -5 cottontail said:

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I don't see how this is going to end well.  Do you really want someone in your unit who you've sued?  All I can see is a whole lot of animosity.

[TheOtherMe]

My sister and BIL learned the expensive way about giving proper notice on keeping the security deposit.  They took the pictures but did not provide an itemized listing to the tenants.  Got taken to court and had to pay treble damages to sucky tenant.  They have never made that mistake again.

[hoops902]

Feb 19, 2019 14:35:30 GMT -5 cottontail said:

Quote removed as post quoted was removed by OP.  mmhmm, Administrator

Something tells me you're in for a world of problems if your plan is to fix the appliances, not cause a ruckus with the tenants right now by demanding they pay for it, then trying to take it out of the security deposit later on once they leave.  You look at it as "I'm trying to avoid problems right now"...they (and many others, including potentially judges) are going to look at it as "you're just looking for an excuse after-the-fact to keep security deposit money for a standard repair you did in the past".  

[hoops902]

Feb 19, 2019 14:59:52 GMT -5 cottontail said:

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I don't think you're an asshole, nor do I particularly think you're wrong.  I think the optics of it aren't necessarily great after-the-fact when a lot of this will probably be disputed by them.  They said they would pay, then said they wouldn't, and it sounds like your strategy is just to let it go now and take the money from security later.  It isn't hard to picture a scenario where a reasonable tenant says "I said I didn't think I should pay, you paid, you didn't push the issue, I should expect that means you were taking responsibility for it".  If I can picture ANY scenario where a reasonable tenant thinks that...that seems even more likely a jerk tenant is going to think that (or claim they thought that).  

I wasn't meaning "problems" as in you are going to lose...I meant "problems" as in they don't seem likely to let it go if they don't know you're taking it from security after it appears you've acquiesced and fixed it yourself.  Obviously I know it's not a post-move money-grab...because you're telling us in real time your plans.  That doesn't change the optics from anyone who doesn't already know your plans like we do.

I do think you're probably in for a giant headache when you take the money out of security to their surprise at the end.  Have they said why they changed their minds?  If you think it's primarily cash flow issues, it might help both sides if you simply proposed holding back the security deposit and had them sign something now saying they're ok with that.  

[hoops902]

Feb 19, 2019 14:59:52 GMT -5 cottontail said:

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The point isn't that you're lying or dishonest...the point is that how you see the issue while you're in it...even if it is 100% correct and true...is not necessarily how people on the outside, or the tenants, will see it later down the road looking back.  

It's not enough to just be right in your own mind, or even right in our minds as you tell us the story.  You need to be verifiably right to people who may look back on this moment from the future (and sometimes even that isn't enough with the way some landlord laws work where it isn't enough to just be right, you've gotta follow the prescribed process).

I certainly wouldn't sue them while they lived there.  But I also wouldn't want to present a possible visual of the situation where it looks like I've agreed to pay to fix something through my actions, and am held to that later.  

The point isn't necessarily whether it's their fault it is broken or not...the point is that you don't want to present something that looks like you agreed that you would fix it and pay for it.  You don't want it to look like they agreed to pay for it, changed their minds, and then you just agreed to do it yourself.  You want to be clear that even when they disputed that they should pay for it...you're only paying for it because you have an obligation to fix it, but that you still consider it their responsibility.

You want to build that trail showing you ALWAYS intended them to pay for it...even AFTER they said they would not.  You never considered it something you were responsible for!

[hoops902]

Feb 19, 2019 16:02:43 GMT -5 cottontail said:

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That depends...do they seem like the kind of people who are going to pour concrete down your pipes if you ask them to pay a bill they're responsible for?  That seems...extreme.  I'm approaching this more from a standpoint of "they're jerks, but not necessarily insane".  

Obviously, some of this depends on your feel of them.  My initial impression of someone who agrees to pay and then backs out is that often it is a problem with not having the money.  Lots of people all of a sudden weren't the cause of the problem when they don't have the money to pay for it (lots of people turn into jerks out of shame or helplessness).  My first step would likely be to ask them to pay for it.  You have, that didn't work out.  My next step would be to have them agree it was their issue, offer to take it out of the security deposit and have them sign something saying they understand it is coming out.  I'd do both of those things before even considering eating the costs myself.

Once I'd gone that far...then I'd start assessing how much retaliatory damage they're likely to do, and how much the cost of the fix/replacement is.  It would also matter to me when they would eventually be leaving.  Leave in a month?  Ok, small enough timeframe to just charge it against the security.  Leaving in 8 months?  I wouldn't want to have it unclear that I was planning on taking the security for this issue 8 months later.  If I decided it was something I wanted to pursue...I wouldn't necessarily tell them I was taking it out of the deposit (because I don't want them to trash the house if they think a significant part of the deposit is already gone)...I'd probably send them a letter (email or text is probably better to me, because I'm not sure I want to send a certified letter which always seems more confrontational if I was worried about retaliation) laying out my case for why it was their issue, what the amount was, and that I would need them to pay it.  

I might also consider laying out my case, and having them sign something acknowledging it was their fault, that I wouldn't hold them financially responsible, but that I also wouldn't be replacing it for them (the longer they plan on being there, the more likely I'd go for this, so that they don't break it again if they're just irresponsible).

[Tiny]

Another thing to consider is can the tenants even pay for a new W/D? If they have to go into debt to do it - what makes you think they will continue to pay rent? Or NOT have animosity towards their landlord?   

Maybe, it's because I'm at a point in my financial life where I can cope with up to $1500 worth of rental property expenses. Replacing the W/D wouldn't be that big a deal. I wouldn't be placing blame. Or thinking about taking my tenants to court (because they "said they would help pay for it"). It would be a somewhat non-issue (that I would document none the less - besides I'd need these documents/bill/proof of payment when I did my taxes - so I'd be killing two birds with one stone.)

In fact, I pretty much budget for that amount every year. On both my rental properties. That's more than 1 month's rent. But, I swear, something happens every year - the stove will die, the A/C will fail, there will be storm damage, the W/D will die, the closet track doors will come off the track one final time, the screen door will finally fail. and the list goes on and on.... it's just like all the crap that goes wrong with my primary house. ::sigh::

Then again my rental properties aren't really factored into my everyday budgeted income. The rents pay for the rental properties (PITI, Property manager and maintenance - ok there's a little left over at the end of the year - but it's nothing to write home about...)

[TheOtherMe]

Feb 19, 2019 16:09:42 GMT -5 cottontail said:

Feb 19, 2019 14:45:17 GMT -5 TheOtherMe said:

My sister and BIL learned the expensive way about giving proper notice on keeping the security deposit.  They took the pictures but did not provide an itemized listing to the tenants.  Got taken to court and had to pay treble damages to sucky tenant.  They have never made that mistake again.

Quote removed as post quoted was removed by OP. mmhmm, Administrator

These tenants used the basement to clean deer.  Sister and BIL had no idea.  They found out because they didn't clean it up.  My mom and sister cleaned it up.  Plenty of pictures and sympathy in small claims court, but it didn't matter because they had not sent the letter outlining the costs and reasons the security deposit was kept.

You can imagine what the rest of the house looked like if the tenants did that in the basement.

The tenants that moved in next have been there over 20 years.  At one time, they had the sheriff serve eviction notice as they were so far behind on the rent.  The next day they came with cash (borrowed from one of their parents) and have paid in cash ever since.  If they are late, they add the late fee.

The wife of these tenants likes the property because BIL lets her keep her horses there and she also does not allow deer hunting on "her" property.  She is stricter than BIL so a visit from the sheriff turned them into awesome tenants.  

BIL has, over the years, let the husband do work around the farm and they have an agreed rate to reduce the rent.  Now he plows the snow because the rental house is down a very long lane.  He gets a $$$ reduction for plowing snow, too.  They have worked it out. 

Now the house that is on the land where they live is a disaster and can never be rented again.  Tenants just left and there was all kinds of drug paraphernalia and it was a hoarder house.  They keep talking about letting the volunteer fire department burn it down. 

[The Walk of the Penguin Mich]

You never answered the question as to how old the set it.  If it is 2 years old, that is a whole lot different from it being 10 years old.

[Bonny]

Feb 19, 2019 14:35:30 GMT -5 cottontail said:

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This is a terrible place to be in.

Your tenants are not going to take care of the property like your relative did. To have that hanging over your head is not going to work well. You need to be honest with your relative (and yourself) and say having the house as a rental isn't working.

I understand where you are coming from. When my mother died I kept her condo thinking it would make a great "old lady" house for me. When my second set of tenants moved out I was livid. The wife left and the house wasn't cleaned for a year. The beautiful white wool carpet she installed was ruined. When I confronted my tenant (who had be lying to me) he said, dogs, teenagers what did you expect? I wanted to punch him (he was a Marine so it was good I didn't!).

I finally sold it two years ago at a good profit. My brother was mad at me but he got over it. I suspect he wanted me to sell it to him cheap but there was no way in HELL I would do business with my brother. When he bought my parent's house from my father it went so bad they didn't talk for 10 years. Mixing family and business usually doesn't work out in my experience.

[Bonny]

Feb 19, 2019 18:49:18 GMT -5 cottontail said:

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You should double-check with your attorney. It may be state specific but generally the LL cannot charge for his/her time. You also cannot deduct your time on your tax return.

I think it's cruel (and selfish) for a family member to expect you to take on a burden that's not in your best interest.

[countrygirl2]

I don't charge tenants for anything.  We have replaced a w/d this year, a dying microwave.  Hubs just went and put a new tall faucet in a sink for a tenant because they wanted one.  They offered to pay and we said no. But we start out with new appliances, water heaters, and furnaces if necessary.  I had a washer that wasn't even a year old, it was a front loader, the bearings went out, it was my washer.  Called repair person, was going to cost $350 to fix!  You will find that appliances are not lasting very long anymore a 6 year old washer can easily die.  I'm not saying they didn't damage it.  But it might be easier to have them move then to try to get money back.  It would be hard to prove they damaged it.   You get into intent and all kinds of stuff.  Do you really want tenants you make mad.  I sure don't.

We allocate a % each year for repairs, you might want to do that too. We don't mind being landlords, we do make money but we just keep dumping it into another rent house.  We are fixing up our last one or so we say.  We have both agreed not to buy more, lets see if we hold strong.  We are agreeing if we do buy anymore we will get loans for them, we will see, this will make 8.

[bean29]

I thought about suggesting a warranty to you yesterday, but I am pretty sure they do not cover appliances in rentals.

[hoops902]

Feb 20, 2019 6:51:37 GMT -5 bean29 said:

I thought about suggesting a warranty to you yesterday, but I am pretty sure they do not cover appliances in rentals.

If I had to guess, they also probably don't cover "someone took a prybar to it".

[resolution]

There is some kind of warranty that you can buy for rentals, because its something that my property manager offered to me as an option.  Warranties are available with companies like American Home Shield.  I chose not to go with it because i figured it would be cheaper in the long run to just repair stuff as it breaks.

[raeoflyte]

If they've been good tenants besides this, I wouldn't go after them for over-filling a washing machine.  Most importantly--I don't see that holding up in court. 

Even if they "agreed" that was the problem when the tech was out I can imagine that after a day or 2 they realized they're not loading the washing machine anymore than any other machine that hasn't broken.  

[hoops902]

Feb 20, 2019 13:08:52 GMT -5 cottontail said:

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It seems weird to have them sign something saying they agree to do something they shouldn't be doing anyways.  I don't understand what the purpose would be...if they do it and break something they're already liable for the issues regardless of whether they sign something or not.  I don't see any advantage to doing that.  I certainly don't see any advantage to THEM for signing something like that.

It's a bit of a conundrum.  You want to hold them responsible for their actions, but then that gives them incentive to try to fix those actions when they're unqualified.  The best way to get them not to try to fix things themselves is to be more lenient on what you're trying to hold them responsible for (i.e.  "accidents happen, call me, I'll get it fixed, if it wasn't malicious or something crazy I'm not expecting you to pay for it")...but that also means not holding them quite as responsible for things you might be able to.  

I didn't rent much when I was younger, but I'd run into this kind of thing when I had less money and owned a house.  Something would break...the smart thing would have been to call someone else to fix it.  I couldn't afford that, so I'd try to fix it myself even though it was probably better than 50% that I'd just make it worse.  But it kind of didn't matter.  If my washer broke and I didn't have the money to pay a repair guy...then either I could risk the 30% chance that I could fix it...or if I broke it worse I was still in the same place I started...no washer to use.  It's "poor people make bad decisions" syndrome.  Some of the "bad decisions" are because your options are not as diverse as they are when you have money...if you know what the "smart thing" to do is, but you don't have the money for it...you take more risk.

You need to convince them that calling you and reporting it isn't going to hurt them financially for honest mistakes (or you likely have to accept the fact that you're going to be chasing them down for higher bills when they try to fix it themselves).  Aligning those interests can be tough.

[raeoflyte]

Feb 20, 2019 12:23:17 GMT -5 cottontail said:

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ummm.....yes I did.  Although your posts have been edited so it's possible that what I was responding to didn't have all the info you have provided at this point.  

You should absolutely follow a lawyers opinion above strangers on the internet, but you asked for advice and now you're upset that people responded.    

Honestly when landlord'ing sucks--it really sucks.  The rest of the time though it seems worthwhile.  Or at least that's what I tell myself.  

[hoops902]

Feb 20, 2019 16:09:09 GMT -5 cottontail said:

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So if that's the line you're drawing, which I think is fine...you need to make that line clear.  On the spectrum of tenants causing problems..."you overloaded the machine" is toward the ticky-tack end (IMO)...and "you bashed the panels with a crowbar" is on the obvious they should pay end.  So I would stop/not start any mention of "you overloaded the machine".  If you want to hold them responsible for anything at this point, I'd focus on "you tore up the panels by trying to fix things yourself, that's not ok".  If you hold them responsible for something like overloading the machine the first time it breaks...that's going to reinforce that anything that breaks they need to worry about paying for (checkin sheet seems irrelevant in terms of overloading the machine, things break, and everything works fine until it doesn't).  

I would focus on reiterating "I don't care that the machine broke, I would have fixed it, I wouldn't have charged you for it, machines break.  I do care that you tried to break open the machine yourself and caused a lot more damage, if you do damage like that you're absolutely responsible for it".  For that to be effective though, you can't focus on the fact that they overloaded the machine (and maybe you don't to them, but you seem pretty fixated on it here).  Their attitude will most likely be "he wants to charge us for the washer breaking when we're doing the same thing we've done to every non-breaking washer ever".  Separate out the initial break as "price of landlording" from the fact they didn't report it and ended up damaging the machine through actions which aren't just normal use.

And if you really want them to pay for it, you can further make your point clear by splitting the bill between "the machine broke" that you pay for, and "you smashed the thing up" that they pay for.

[The Walk of the Penguin Mich]

Cottontail......I seriously doubt that they have known that the washer has been eating socks for months and months.  It would be impossible for them to tell you that back then.  I suspect it goes like this....

"Hmm, this sock is missing, must have forgotten it."  puts orphan sock aside.  
Lather, rinse, repeat

After months and months, they look at the 22 orphan socks they have put aside over the months and months  and realize that they have more than the average number of orphan socks one has.  I have found socks in fitted sheets that are folded in the linen closet, stuck in a leg of winter pants that I have not worn in 4 months, fallen in the back of the washer, behind a dresser, ad nauseum. A sock missing is not a reportable condition. Would you really want someone to report to you that your washer is eating socks with a couple of missing socks?

Now, I am not saying that they should have taken the panel off the back of the washer, but let me ask you this.  Would you take them seriously if they called you and said they thought the washer was eating socks?

[hoops902]

Feb 22, 2019 13:29:59 GMT -5 The Walk of the Penguin Mich said:

Cottontail......I seriously doubt that they have known that the washer has been eating socks for months and months.  It would be impossible for them to tell you that back then.  I suspect it goes like this....

"Hmm, this sock is missing, must have forgotten it."  puts orphan sock aside.  
Lather, rinse, repeat

After months and months, they look at the 22 orphan socks they have put aside over the months and months  and realize that they have more than the average number of orphan socks one has.  I have found socks in fitted sheets that are folded in the linen closet, stuck in a leg of winter pants that I have not worn in 4 months, fallen in the back of the washer, behind a dresser, ad nauseum. A sock missing is not a reportable condition. Would you really want someone to report to you that your washer is eating socks with a couple of missing socks?

Now, I am not saying that they should have taken the panel off the back of the washer, but let me ask you this.  Would you take them seriously if they called you and said they thought the washer was eating socks?

I would love to see landlord reactions if renters called them and said "hey, I just did laundry and there's a sock missing...better send a service guy out to look at the machine".  

[cottontail]

I am wondering how people determine how much rent to charge. I compare rents on Craigslist - anywhere else I should look?

It seems like housing number of bedrooms is the most important factors in my area. Is that true for your area?

If you feel that lower rent gives you more choices in tenants and may keep better tenants, how much below market rate do you charge?

Do your tenants take care of mowing and plowing? If so, do they do a decent job of it? What do you do if they don't do it or do a bad job?

I can't get the hang of posting on a phone. Please excuse any typos.

[Works4me]

Cottontail - Best reference ever:

Landlording: A Handymanual for Scrupulous Landlords and Landladies Who Do It Themselves
by Leigh Robinson

[cottontail]

Feb 26, 2019 5:10:15 GMT -5 Works4me said:

Cottontail - Best reference ever:

Landlording: A Handymanual for Scrupulous Landlords and Landladies Who Do It Themselves
by Leigh Robinson

Thank you. I put it on hold at my library.

I also found out that the owner of the appliance repair shop I used does not put washers or dryers in his rentals. 

[countrygirl2]

Deleted

[cottontail]

PLEASE DON'T QUOTE THE FIRST PARAGRAPH, AS I MIGHT DELETE IT.

So I deleted my posts in case things end up going to small claims court. But yes, my tenant specifically said that the reason for removing the panels was that they were losing socks a long time ago (many months), and they did not mention it to me until more recently when the machine completely stopped working mid-wash.

I'm getting the book that Works4Me suggested.

Does anyone have any advice on the questions I asked in post #553, like how do you determine how much rent to charge? It's a unique property (I don't want to get too specific here), so I'm thinking that I should compare to what's out there and then make adjustments for the pluses and minuses of my property. Anywhere besides Craiglist that I should be looking for comparison?

[Tiny]

I haven't had to set rent on my out of state property - as the Property manager provides guidance.   My local property was, well, a slum (everything worked - but a 1960's kitchen in Olive Green and with a 1960's bathroom also in Olive Green) so went below market (which Turbo Tax told me about when I entered the numbers for the year.)

That said, I found this via The google: 


www.mysmartmove.com/SmartMove/blog/how-determine-fair-market-rent.page

 
The U.S. Department of Housing and Urban Development (HUD) estimates fair market rents annually. Since they look at rents across the country, it’s a good place to start your research, but you’ll want to get a more localized view to see if rates in your area are the same or differ from HUD’s fair market rent estimations.



This is the link to the HUD "fair market rents annually"  site: 
www.huduser.gov/portal/datasets/fmr.html

Hud breaks out the numbers by year, state, county, and zip code. 


Perhaps this will help you.    


ADDED:  a way to guestimate  would be to think about the income of the available pool of renters  who MIGHT like to rent your property - and then figure out what 30% of their gross monthly income would be.     That's probably the highest rent you could ask.  30% of Gross can be tough to come up with when you figure in car payment, cell phone, utilities, CC debt, maybe a student loan or two...         

[cottontail]

Ti4ny - I checked out your links and then looked at the housing authority webpage for my area. It looks like I would get *quite a bit more rent if I accepted Section 8. I am not going to go down that road but it is interesting to see. I would imagine that Section 8 is a nightmare to deal with.

ETA - *About 35% more rent.